Summary
MPLX LP (MPLX) announced on September 1, 2017, the completion of a significant transaction involving the acquisition of certain ownership interests in joint venture entities indirectly held by its parent, Marathon Petroleum Corporation (MPC). This strategic move, executed through a Membership Interests and Shares Contributions Agreement, significantly expands MPLX's midstream asset base and integration with MPC's operations. The acquisition includes stakes in key pipelines such as Illinois Extension Pipeline Company, LOOP LLC, LOCAP LLC, and Explorer Pipeline Company. The total consideration for this transaction was approximately $1.05 billion, comprising $420 million in cash and $630 million in MPLX common units issued to MPC's subsidiaries. This transaction underscores MPLX's role as MPC's primary midstream growth vehicle and enhances its fee-based revenue streams.
Key Highlights
- 1MPLX LP acquired significant joint venture interests from MPC, including stakes in Illinois Extension Pipeline, LOOP LLC, LOCAP LLC, and Explorer Pipeline.
- 2The total transaction value was approximately $1.05 billion, consisting of $420 million in cash and $630 million in MPLX common units.
- 3The acquisition was completed on September 1, 2017, through a Contributions Agreement with MPC's wholly-owned subsidiaries.
- 4MPLX issued over 18.7 million common units and 377,778 general partner units to MPC subsidiaries as part of the consideration and to maintain the general partner interest.
- 5Following the transaction, MPC indirectly holds approximately 29% of MPLX's common units, demonstrating continued strategic alignment.
- 6The transaction is expected to enhance MPLX's fee-based businesses and expand its midstream infrastructure footprint.
- 7The transaction was approved by MPLX's conflicts committee and board of directors, with independent advisors engaged for evaluation and negotiation.